Fans in the Middle, and Always Losing

Fans in the Middle, and Always Losing

by: Andrew Mason

Imagine your favorite band is coming to town.  Not the band you occasionally hear on the radio whose catchy pop melodies and formula written lyrics occupy the minds of many, but the band whose music has stuck with you in the high times as well as the low.  The band whose lyrics, so smartly crafted and carefully placed, seem to resonate long after the song has finished.  The band, whose shirt you've worn to bits, style you've tried to emulate, and lyrics you've completely memorized.   The artists whose music you've been listening to for the better part of five years has finally decided that they have been dragging you on for too long.  Your town has somehow found its way onto a long list of tour stops around the country.  Whats your first order of action? Acquiring tickets of course!  In today's day and age, more and more tickets are being sold exclusively over the internet by online ticking providers such as Ticketmaster.  Nothing beats the instant convenience of printing out the tickets in the comfort of your own home.  Through the bands website, Twitter feed, Facebook page, etc, you find out when the online tickets become available.  Several minutes prior to the online release time you log into your Ticketmaster account with your credit card information already stored and your cursor hovering over the page refresh.  The one minute prior to the hour seems like it goes in slow motion as you eagerly await a swift click of the mouse.  You refresh the page seemingly simultaneous to the advent of the new hour.  Loading screens soon follow claiming that "they" are trying to find you the best available tickets.  The page finally loads only to display the agonizing message "This is a popular event.  All available tickets have been purchased."  You continue to refresh the page in disbelief, wondering how a venue that seats a couple thousand could have sold out in less than 15 seconds.  The horrible truth then becomes apparent as you check Stubhub and find countless tickets for the show available for 400% face value.  The scalpers have won.



Ticket scalpers, ticket touts, or the more politely phrased ticket "brokers," all have one common goal in mind: buy tickets to popular concerts, sports matches, or events and turn around and sell these tickets for a handsome profit.  Scalpers work under the risk that the event to which they bought several tickets for will not sell out. The premise of the whole operation works under the simple concept of supply and demand.  If tickets become unavailable to an event many people want to attend, the amount of money an individuals will pay for the ticket increases.   Scalpers take advantage of this lucrative trade and "secondary ticketing," a phrase coined Jeff Fluhr, the founder of Stubhub, generates over $12 billion a year.  But isn't this activity illegal?  I mean the scalpers have no intention of attending the event and their buyout only increases the cost for those who actually want to attend.  The answer is no, most states do not have strict laws that prohibit the resale of tickets, mainly laws that regulate with specific stipulations.  (For state to state laws regarding ticket resale, click here).  In the US, 38 states allow the resale of tickets as long as the sale does not take place at the sight of the event while 12 other states have varying degrees of regulation.  For those states that do regulate and prohibit, efforts are becoming more and more strained as ticket resale has moved from the streets to the internet.

Stubhub is an online marketplace that provides services for buyers and sellers of tickets.  The company, now the largest secondary-ticket vendor in the world, was founded by Eric Baker and Jeff Fluhr in 2000 and is now owned by eBay.  The site allows sellers to post available tickets on the site at any price they choose and then charges commission on both the buyer and the seller.  Those looking for tickets to a sold out show may use the sight to find available tickets posted by the sellers.  So whats the problem with system?  Individuals looking to turn a quick profit are supplementing their annual income at the expense of those looking to enjoy a concert or sporting event.  The site allows sellers to be digital middlemen, their only job: transferring the possession of the ticket from themselves to the fan.  And even then, Stubhub does most of the work.  Sometimes the site is beneficial to the buyers.  If an event does not sell  out or a fan posts tickets because they genuinely cannot attend the event, the buyer might actually save money.  The real problem comes when a majority of the tickets for a sold-out event fall into the hands of scalpers, which is many times the case.  Sellers will oftentimes utilize scalp seeding, a method where scalpers will wait for a specific time to begin selling the tickets, to maximize the profits associated with supply and demand.  

I don't have a problem buying a ticket near face value from an individual that, due to unforeseen circumstances, cannot possibly to a concert.  I do however have a problem giving a large portion of the ticket's value to the individual who had no intentions of going to the show, and more often than not, this is the case.  When checking Stubhub, I often see multitudes of tickets (10 to 20) being sold by one individual.  How did they acquire all these tickets when Ticketmaster limits the amount of tickets each card holder can buy?  Digital scalpers employ an army of ticket snatching bots, software that is capable of making thousands of transactions a second, that buy up all the tickets before the human fans have a chance to hit refresh.  Not only do scalpers consume a large portion of the tickets sold, they also make it near impossible for humans to buy tickets at face value right from the source.  The New York Times reported that bots buy up 60% of all online tickets sold by Ticketmaster.  A well known, and highly controversial debate over ticket bots arose after thousands of real people lost the chance to see LCD Soundsystem's final show at Madison Square Garden.  The fact that many of his fans felt cheated and outraged at the prices they would have to pay made lead singer James Murphy lash out at the scalpers.  Murphy wrote a heated blog post depicting his disgust for what had transpired and ended up scheduling 5 more shows at Manhattan's Terminal 5 venue to decrease the value of the scalpers tickets and also allow his fans to see the band perform. (Murphy's heated Blog).  In a similar fashion, Arcade Fire, Coldplay, and Mumford and Sons have had thousands of tickets sold out in a matter of seconds thanks to the ticket bots.



Many times it's up to the band itself to decide how they are going to distribute tickets and they are starting to employ new methods to beat the scalpers.  I have attended a few shows where it was necessary to present a drivers license the credit card used to buy the tickets.  Arcade Fire recently had a 'secret' show in Brooklyn, NY and sold over 75% of their tickets in pre-sale.  Each pair of tickets required a pre-sale code that could only be obtained by pre-ordering the album.  This, however, did not prevent people from selling the tickets on craigslist and Stubhub.  Some of the tickets reached upwards of $2000.  Although these systems seem to help put tickets straight into the hands of the real fans, there are some drawbacks.  If a fan who initially planned on attending the event suddenly cannot, there would be no way to sell, or even give away his or her tickets if the credit card and driver's license of the buyer is required at the door.

Ticket scalping, especially with its proliferation over the internet, is a serious issue that needs to be addressed by lawmakers and fans.  More and more, true fans are subjected to paying way over face value and also steep fees in order to see their favorite entertainment.  Unfortunately, whether its from the excessive fees and mark-up or by the strict regulations the band places on the tickets in order to thwart scalpers, the fan seems to lose.